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Duncan Association of Detailman Vs GLAXO

This case discusses the validity of a pharmaceutical company's policy prohibiting employees from marrying employees of competitor companies due to conflicts of interest. The company, Glaxo, transferred an employee, Pedro Tecson, to a new region after he married an employee of a competitor, Astra. Glaxo argued the policy was valid to protect its trade secrets and business strategies. The court ruled in favor of Glaxo, finding the policy a reasonable exercise of management rights to protect the company's economic interests against gaining access by competitors. While laws aim to protect workers, management also has valid rights that deserve enforcement in matters of business protection and fair play.

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892 views1 page

Duncan Association of Detailman Vs GLAXO

This case discusses the validity of a pharmaceutical company's policy prohibiting employees from marrying employees of competitor companies due to conflicts of interest. The company, Glaxo, transferred an employee, Pedro Tecson, to a new region after he married an employee of a competitor, Astra. Glaxo argued the policy was valid to protect its trade secrets and business strategies. The court ruled in favor of Glaxo, finding the policy a reasonable exercise of management rights to protect the company's economic interests against gaining access by competitors. While laws aim to protect workers, management also has valid rights that deserve enforcement in matters of business protection and fair play.

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Anonymous S1b6TV8
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© © All Rights Reserved
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Duncan Association of Detailman-PTGWO vs. Glaxo Phils.

[G.R. No.162994. September 17, 2004]


Facts:
Pedro A. Tecson was hired by Glaxo Wellcome Philippines, Inc.) as medical representative on October 1995,
after Tecson had undergone training and orientation. Tecson signed a contract of employment which
stipulates, among others, that he agrees to study and abide by existing company rules; to disclose to
management any existing or future relationship by consanguinity or affinity with co-employees or employees of
competing drug companies. The Employee Code of Conduct of Glaxo similarly provides that if management
perceives a conflict of interest or a potential conflict between such relationship and the employees
employment with the company, the management and the employee will explore the possibility of a transfer to
another department in a non-counterchecking position or preparation for employment outside the company
after six months.
Tecson was initially assigned to market Glaxos products in the Camarines Sur-Camarines Norte sales area.
Subsequently, Tecson entered into a romantic relationship with Bettsy, an employee of Astra Pharmaceuticals
(Astra), a competitor of Glaxo. Bettsy was Astras Branch Coordinator in Albay. Despite of warnings, Tecson
married Bettsy. The superiors of Tecson reminded him of the company policy and suggested that either him or
Bettsy shall resign from their respective companies. Tecson requested more time to resolve the issue. In
November of 1999, Glaxo transferred Tecson to Mindanao area involving the provinces of Butuan, Surigao and
Agusan del Sur. Tecson did not agree to the reassignment and referred this matter to the grievance committee.
It was resolved and was submitted to voluntary arbitration.
Issue:
Is the policy of a pharmaceutical company prohibiting its employees from marrying employees of any
competitor company valid?
Ruling:
Glaxos policy prohibiting an employee from having a relationship with an employee of a competitor company
is a valid exercise of management prerogative. Glaxo has a right to guard its trade secrets, manufacturing
formulas, marketing strategies and other confidential programs and information from competitors, especially so
that it and Astra are rival companies in the highly competitive pharmaceutical industry.
The prohibition against personal or marital relationships with employees of competitor companies upon Glaxos
employees is reasonable under the circumstances because relationships of that nature might compromise the
interests of the company. In laying down the assailed company policy, Glaxo only aims to protect its interests
against the possibility that a competitor company will gain access to its secrets and procedures. That Glaxo
possesses the right to protect its economic interests cannot be denied.
No less than the Constitution recognizes the right of enterprises to adopt and enforce such a policy to protect
its right to reasonable returns on investments and to expansion and growth.

Indeed, while our laws endeavor to
give life to the constitutional policy on social justice and the protection of labor, it does not mean that every
labor dispute will be decided in favor of the workers. The law also recognizes that management has rights
which are also entitled to respect and enforcement in the interest of fair play.

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